As the Managing Partner at Red Rocket Ventures, I have had exposure to over 500 startups in the last few years. I have seen really good startups and really bad ones. Below is a summary of the recurring problems I have seen in the flawed startups, and where relevant, how venture investors typically react to such problems.

Technology is advancing so rapidly that most of today’s industry leaders will slip into oblivion by the end of this decade. The only companies that will survive are those that invest heavily in research — and take big risks. Nothing illustrates the difference between companies better than Facebook and Google.

Partnerships are just one potential avenue for a startup to achieve value. A startup could build a new product, market to new customers, buy google adwords, etc. to achieve value. The challenge of business development and partnerships is evaluating needs to prioritize based on strategic objectives.

The word “entrepreneur” gets thrown around a lot these days and has a certain sexy tone to it. The Merriam-Webster dictionary defines the word as “A person who starts a business and is willing to risk loss in order to make money.” The words “willing to risk loss” are a major red light for many aspiring entrepreneurs and definitely remove much of the sexiness.

In July, Paul Graham of Y Combinator published an excellent essay titled “Do Things That Don’t Scale.” In it he highlights several unscalable activities that are critical for early stage startups trying to reach scale. One of those practices is the concept of ‘Delight’ — being attentive to early customers at a level of service that makes them feel that “signing up with you was one of the best choices they ever made.”

Could the religious faith of a founder make or break a startup? We don’t yet know the answer. But a team of Baylor University researchers is delving into the topic. They already know that entrepreneurs pray more often than non-entrepreneurs. They also believe God listens and engages in those prayers.

What do you think?

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